7/22/2002 @ 12:00AM

All the Right Parts

231. MAGNA  AUTO PARTS

The North American automotive-parts industry crashed and burned last year, and one of the few bright spots was Magna International. Magna’s net income of $580 million was only 3% below its record results for 2000.

Aurora, Ont.-based Magna–which expects to account for an average of $425 in parts on every car built in North America in 2002–makes key components such as seats and electronic systems. Last year it was boosted by two big supply projects: the Ford Escape SUV and the GMT-800 (GM’s biggest pickups and SUVs).

Peter Sklar, an auto-parts analyst at BMO Nesbitt Burns, the Bank of Montreal’s investment banking group, thinks that Magna has great management. Belinda Stronach, the founder’s 36-year-old daughter, took over the helm in February 2001 and has maintained a decentralized system where plant managers call their own shots and are motivated by receiving a share of their plant’s profits.

Profits are expected to increase 10% to $6.85 a share in 2003. Magna trades at just 12 times 12-month trailing profits and 10 times its 2003 estimate.